Buffalo City councillor, businesswoman arrested in R1.2m fraud scandal

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A Buffalo City Metropolitan Municipality councillor and a businesswoman were arrested in a R1.2 million fraud case.
A Buffalo City Metropolitan Municipality councillor and a businesswoman were arrested in a R1.2 million fraud case.
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  • A Buffalo City Metropolitan Municipality councillor and a businesswoman have been arrested in a R1.2 million fraud scandal.
  • The municipality hired the businesswoman to organise a commemoration for Phakamisa township's 40th anniversary.
  • The two appeared in the East London Magistrate's Court and were released on R3 000 bail each.


A Buffalo City Metropolitan Municipality councillor and a businesswoman have been arrested on charges of fraud and money laundering worth R1.2 million.

The Hawks arrested ANC councillor Mthetheleli Crosby Kolela, 58, and businesswoman Noxolo Maureen Tshaka, 49, on Tuesday. The two appeared in the East London Magistrate's Court and were released on bail of R3 000 each.

Tshaka allegedly gave Kolela money to organise an event her company had been hired to arrange, which was in breach of the agreement with the municipality.

Eastern Cape National Prosecuting Authority (NPA) spokesperson Anelisa Ngcakani said:

[The municipality] organises annual events and issues an advert for event management companies who wish to partner with the municipality to submit proposals. During the 2019-20 financial year, Kolela was a member of the BCM (Buffalo City Metropolitan Municipality) sponsorship committee. BCM was in the process of sponsoring a number of events and one of them was the Phakamisa 40th anniversary celebrations, which were scheduled to take place in December 2019.

The event was to be held in celebration of the establishment of Phakamisa township, situated about 9km from Qonce (formerly King William's Town).

"Following a number of meetings held by the sponsorship committee in November 2019, the committee approved the funding for the event and awarded it to Sibu's Catering and Cleaning Services Pty Ltd. Tshaka, who was the sole director for Sibu's Catering, entered into a Service Level Agreement with BCM on 06 December 2019," said Ngcakani.

Ngcakani said they agreed the event would be organised by Tshaka Trading, the mother company of Sibu's Catering and Cleaning Services Pty Ltd, and that Tshaka Trading would not delegate its financial management responsibilities to a third party.

She said:

Kolela and Tshaka entered into a memorandum of agreement on 2 December 2019, where it was agreed that Tshaka and Sibu's Catering would receive sponsorship money as a conduit for the Phakamisa community in order to organise and manage the 40th anniversary. The celebrations were scheduled to take place from 13 to 16 December 2019.

On 3 December 2019, Tshaka allegedly opened a First National Bank (FNB) account for the sole purpose of receiving the sponsorship money. On 13 December 2019, the municipality paid R840 000 into the account. The following day the money was allegedly transferred to another account of which Tshaka was a signatory.

"It is alleged that on 19 December 2019 a cash withdrawal of R544 783.80 was made in favour of Kolela. Nine days later, BCM paid R360 000 into the FNB account, which was opened by Tshaka on 3 December 2019," Ngcakani said.

"It is alleged that Kolela organised the Phakamisa 40th anniversary himself instead of Tshaka," Ngcakani said.


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